Mr. Graeme O'Neill reports

BAYHORSE SILVER MAJOR ADVANCES DURING 2016

Bayhorse Silver Inc. chief executive officer Graeme O'Neill wishes all Bayhorse shareholders, and investors, a merry Christmas and a happy, and prosperous, new year. The company wishes to recap major advances this year and to outline plans for the year to come.

Bayhorse silver mine: Electrical service, connection at the Bayhorse silver mine site by the electrical utility, is under way, allowing commissioning and operation of the crushing and upgrading plant. To provide an upgrading benchmark for further work, the company plans first to test run the 300 tonnes of stockpiled mineralized material left behind from the 1984 mining program. After comprehensive assaying and testing by Met-Solve Labs in 2014, 2015 and 2016, as disclosed in prior news releases, the stockpile is estimated to contain an average grade of 5.28 ounces per ton (164.2 grams per tonne) silver. This will provide an upgrading benchmark against which the company will compare results of processing the 2,000 tonnes of mixed run-of-mine mineralized material that was extracted from the intermediate level workings during the latter half of 2016.

Opening of the upper adit will provide the required secondary escape way. In addition to conforming to ventilation and safety requirements, this permits the extraction of the substantial amount of mineralized material left unmined since 1926 and not touched during the 1984 mining program. To guide extraction of this material, the company has the reliable, comprehensive mine plans, surveys and assay data compiled during the 1959, 1976, 1981 and 1984 programs.

This material from the upper adit will provide additional feed for the crushing/upgrading circuit during the first months of the new year. It will also provide two tonnes to three tonnes of mineralized material that will be shipped to Steinert USA for a bulk-scale ore sorting test to follow up the initial ore sorting testing that has just been successfully completed.

Bridging the Gap (BTG) project: Assay results have been received for the first diamond drill hole at the project and are currently being correlated with the drill logs. Anomalous gold, lead and zinc values have been identified within the 113 samples submitted. The company is anticipating recommencing the drill program in late February, 2017.

Financing: During 2016, the company financed its operations through the placement of $1.25-million (U.S.) in debenture units, as well as through the exercise of 8,260,341 outstanding options and warrants priced at 10 cents and 15 cents. The company has granted 120,000 incentive stock options to officers and consultants exercisable for five years at 12.5 cents each.

Investor awareness: The company participated in the San Francisco silver summit in November where David Morgan of the Silver Investor interviewed Mr. O'Neill regarding progress at the Bayhorse mine and the BTG project. That interview can be viewed on-line.

The company will be participating in the Cambridgehouse Vancouver resource investment conference in January, 2017.

Staff: Dr. W. Willoughby, PE, has consented to provide mine engineering consulting services to the company. Dr. Willoughby is a highly experienced mining engineer with 35 years of experience in all aspects of mining projects, including planning and evaluations, exploration, drilling, underground and surface development, technical studies, permitting, and financing.

This news release has been prepared on behalf of the Bayhorse Silver board of directors, which accepts full responsibility for its contents on behalf of the board. Dr. Clay Conway, PGeol, a qualified person and director of the company, has prepared, supervised the preparation of or approved the technical content of this press release.

Bayhorse Silver, a junior exploration company, is earning an 80-per-cent interest in the historic Bayhorse silver mine, Oregon, United States. Bayhorse is also earning a 75-per-cent interest in the past-producing Bridging the Gap project, consisting of ASARCO's historic Crown Point, Silver King, Ranger, Wyoming, Curlew and Blackhawk silver/lead/zinc mines in Idaho's Silver Valley.